The View From 37,000 Feet

In-plane wifi allows The Turd to end his vacation and get back to work.

Well, that was a whirlwind. It was good to get away for a few days but, sheesh, I almost feel like I have a better chance in the Comex casino than I did at the MGM Grand. If it wasn't for Sweetness being such a lousy golfer, I wouldn't have won anything over the weekend! Oh well, back to work and there's certainly no shortage of things to discuss.

I've got to start with The Pig this morning as the level of sustained BS in the markets these days is simply amazing. Back on Friday, little Ole Turd was able to predict that the POSX, rest precariously upon some critical support near 79, would soon need to be rescued via some Fed Goon-speak or negative Euro headlines. Whaddayaknow, we got both. There's a big surprise! Oh well, as you can see on this daily chart, the drama is slowly building to a climax. Look for the decisive breakdown by the end of this month and, once through 79 and 78, the next target is 73.

<Unfortunately, the airplane wifi is so slow that I'm unable to add charts>

Speaking of lousy fiat, it looks like Abe is going to get his wish. The Yen is continuing its historic puke-job this morning and is now just above 108. Next support on the weekly chart doesn't look to come in until 105 or so but Abe's goal of 100 certainly looks within reach. Please don't underestimate the long-reaching geo-political effects of this.

Crude is selling off after failing three times to get through the $98 level, which we had been watching here for the past several weeks. I'm hoping to watch it fall even farther so that I can re-establish a position somewhere near $93.

And Sylvia finally broke through $1700 overnight. Once it did, it tripped some buy-stops and sprurted all the way to 1710 before pulling back and establishing 1700 as support. Let's hope it can draw clear now as a continued move higher will, undoubtedly, add some spillover strength for gold and silver.

Speaking of which, both are rallying smartly as I type on the backs of reported very strong physical demand in London today on the earlier price drops. Let's see if we can keep this up as we go trhough the day and the week. Gold needs to exceed last weeks highs of 1685 or so before it can begin a run on 1695 and then the all-important 1700-1705. Silver will see continued resistance at 32.20-32.50 and we're going to need to plow through there before we can get excited.

Finally, just a few words no last week's CoT. It was simply remarkable, not only for the size of the moves but the divergence in structure between the metals.

In gold, The Cartels covered a net short of 28,900 contracts, a truly remarkable amount. This brings their net short ratio all the way down to 2.04:1. This has likely fallen even farther in the three days since the survey as total OI contracted Wed-Fri by another 6,600 contracts and stoof Friday evening at just 424,150. This is the lowest OI number since the price lows of 12/27/12 and, before that, late August of last year. Additionally, the large specs reduced their net long by 25,000. Between the OI numbers, the CoT structure, the charts and the physical demand, there is simply very little chance that gold is going to decline much father from here.

In silver, The Civil War continues and The Monkeys on the JPM silver desk have apparently decided to adopt the ultra-successful, Bruno Iksil-model of doubling down while praying for salvation. Like Iksil, they will ultimately fail in spectacular fashion.

For the CoT week, while price was falling by over a dollar, JPM was forced to add shorts. This never happens. As you know, JPM always rigs declines on order to ring the register on the LargeSpecSheep. However last week while price was falling, the LSS were covering shorts and adding longs, to the tune of net +3,700 contracts and the other commercials added 600+, too. This forced The Forces of Darkness to create 3,483 fresh, paper shorts when the would otherwise have been able to cover, instead. In fact, Uncle Ted estimates that JPM alone added another 2,500 nakes shorts last week, bringing their total Comex short position to over 33,000 contracts. When you take out the 47,000 spread contracts, JPM is short over 33% of the entire open interest!! This is brazenly unfair and manipulative yet Thunderlips and Cueball continue to look the other way and allow this criminal concentration to continue. Simply disgusting.

On the bright side, JPM has built themselves a funeral pyre of epic proportions. It's made of kindling, fireworks, TNT, gasoline and gunpowder and it could literally explode at any moment. When it does, the spectacle will be truly breathtaking.

OK, that's all for now. This old MacBook can barely carry a charge anymore so I'd better sign off before it cuts out. Back to work with a full post and lots of pretty charts tomorrow. Have a great day!

They can engineer any event (Osama Bin Laden) or non-event (late Sep 2011) at will to get out of a jam.

It is their market and NEVER forget this...

Argument - Well, what about the late 2010 and early 2011 run-up? Sure, they were "hurt" maybe a little at that time but that was more than made up for during the May and Sep 2011 takedowns (after all suckers were on-board) - ungodly sums were made and the paper system remained preserved. And the Bonus - sentiment in the PM markets was destroyed and it still sucks almost 2 years in now...

In 2008 or 2009, Nicole Foss predicted that we would have "the mother of all dead cat bounces" as the "market" recovered from its downturn. So far it's been a bigger bounce than she predicted. She isn't really good at precise timing nor price levels, but she is better than Kunstler at the really really big picture. Before that, Nicole famously predicted that the price of oil would not continue from its runup, and that it would fall for quite a while before it regained that $140 level. That prediction was what started my paying attention to her.

Economic contraction and the fate of the nation

Released: January 31, 2012

JHK steps up to resume the KunstlerCast solo without Duncan Crary. I’ll do interviews with guests sometimes, and sometimes I will just yak on my own. This week I was fortunate to have Nicole Foss ofTheAutomaticEarth.com swing by as an overnight houseguest and we got to sit down at the microphones for a chat. Nicole is a veteran of Canadian government’s electrical ministry and has worked in the nuclear energy ministries of the UK and the European Union. She has lectured all over Europe, the USA, Australia and New Zealand in recent years.

The bottom line: even if gold gets down to $1100 you won't be very happy with that event, because it means a lot of other things. And, the "thing" we are preparing for will not be over in a couple weeks or a year. It will be, as far as you are concerned, a permanent change in our way of life.

They can orchestrate any event (Osama Bin Laden) or non-event (late Sep 2011) at will to get out of a jam.

It is their market and NEVER forget this...

Completely agree. The bankers can do whatever they want, whenever they want. Anybody trading silver or gold is going to get screwed.

Anybody stacking gold and silver and maintaining an EMOTIONAL attachment to their metal is also going to get screwed. Buy it, put it away, and don't follow the price. Following the price will make you depressed and cause you to sell before you should. Having an emotional attachment will prevent you from selling when you should.

Fake American Eagle silver coins surface

Counterfeit 2011 American Eagle silver bullion coins have been appearing in the market in Canada. The fake coins bear no silver. Arrows on this fake example point out major diagnostic points, explained in the article and on later images.

A counterfeit 2011 American Eagle silver bullion coin recently passed as genuine at a coin shop in Toronto contains no silver, but does contain a trace amount of gold in its composition.

Andrew Greenham from Forest City Coins in London, Ontario, Canada, obtained the counterfeit from a second Toronto dealer who had acquired 10 examples from yet a third, unidentified, Toronto dealer, who was duped into purchasing the pieces from an unidentified seller, as genuine silver Eagles.

It is unknown how many counterfeit 2011 silver American Eagles were passed as genuine and whether fake silver American Eagles bearing other dates are also in the marketplace.

U.S. Mint spokesman Michael White said Jan. 26 that Mint officials were unaware of the counterfeits. White said he forwarded to the U.S. Secret Service information provided by Coin World about the counterfeits. The Secret Service confirmed being contacted by the Mint.

To all of those who gave me a 'hat tip'...I thank you....I felt very loved and appreciated...so much so, that I did not change the locks on the house...I suppose I should let the 'turd' back into this home, so that, he may continue his journey with this website and all of it's goals. Please continue to support the 'cause'....the positive feedback, suggestions, donations and all those light-hearted funnies are essential to the success! He studies, reads and works more on this website than you can imagine....he is constantly thinking, re-evaluating and connecting to serve you to the best of his ability. Thank you for all that each and every one of you have brought to our lives...most of you anyway

Canada has reached a milestone, with it's end date passing of the Canadian penny.

Business will be given the latitude to round up, or down, prices. If something is priced at $1.03 you may round up the price by two cents, or down to an even dollar.

LMFAO!

There will be NO rounding down! Give your head a shake! This is a golden opportunity, for one of the biggest cash grabs by business ever presented by the government. Paper is paper. The penny wasn't even made of copper anyway. It was made of cheap base metals. More currency destruction. Good for physical gold and silver.

Adding to your correct comment, JPM and the Fed are essentially one-and-the-same entity. The Fed can create, at will, any amount of digital money to supply and allow JPM to control/manipulate any market. Silver is the canary in the gold mine. Silver is smaller, but people pay attention to it as they do gold. Silver. Must. Be. Controlled.

The Achille's heel for Fed/JPM is that they do not have ready supplies of physical silver like they do for gold. So far, they have been successful at mobilizing the silver that does exist to meet physical demand. That pile diminishes daily, even with continuing mine supply.

As stated here ad nauseum, (almost) nobody is going to get rich in silver while COMEX trades it. When they no longer trade it, the paper game will be over, and physical silver will look completely different.

"Fundamentally, Obama’s continued support for Holder illustrates that Obama is still committed to the policy of holding financiers to a lesser standard of justice than other citizens. The big banks continue to ride roughshod over the American people with the complicity of the political class."

Dmitry Medvedev: But it seems to me that it is important that at any time one or other reserve currency should perform the functions, if you like, of the main reserve currency. Although the euro is in a sorry state now, I think the euro was very helpful for the world economy and world finances in 2008-2009. At the time the dollar was down, and there was even talk of the collapse of the dollar system, and then the euro played a stabilising role. That is why we believe that the global economy based on several reserve currencies is better than a global economy based on one reserve currency, and so we believe that the euro must be preserved. It would be still better if there were more such currencies. I think the yuan potentially can claim such a role.

And Sylvia finally broke through $1700 overnight. Once it did, it tripped some buy-stops and sprurted all the way to 1710 before pulling back and establishing 1700 as support. Let's hope it can draw clear now as a continued move higher will, undoubtedly, add some spillover strength for gold and silver.

I tried to Bing it. Google keeps ticking me off if I remember correctly. All I found were some films, and a wanna be star. Isn't Sylvia part of Berlusconi's name?

Also if you are at all afraid of the fake non-silver eagles. They will show their color as grey under a single ply of tissue paper. This story has the flavor of the tungsten-gold bars in the MSM. Silver shows through the Tissue as white.

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